With hiring returning to pre-recessionary levels the best candidates are now receiving multiple offers and counteroffers as businesses recognise that the talent pool is shrinking.
According to new research by specialist recruiter Robert Half, two-thirds (65%) of UK finance leaders have seen an increase in counteroffers over the past 12 months, with one in five (20%) saying they have increased significantly.
The study, carried out with 200 finance leaders, highlights that it’s not just counteroffers that have increased. Almost two thirds (64%) of senior finance professionals are more likely to offer a sign-on bonus to attract top candidates than they were last year highlighting that the war for talent remains fierce and that 2015 is shaping up to be a job candidate’s market.
Finance leaders were asked, “Over the past 12 months, has the prevalence of counteroffers increased, decreased, or stayed the same?”
Phil Sheridan, UK managing director of Robert Half, said, “With counteroffers increasing and a shrinking talent pool, it is now more important than ever for firms to act quickly. Those that are slow to get their offers out of the door will find they get left behind. Flexibility is also key – companies that are too rigid with their job offers may find they cannot secure their top choice of candidate. Remuneration expectations are increasing so businesses need to prepare to negotiate with their chosen candidate.”
Although counteroffers can be a strong bargaining tool for job seekers, they are not an effective long term strategy to retain staff. When asked about how the trust between employee and employer was affected, more than half (55%) of finance leaders said it was negatively impacted. In order to retain top talent, underlying issues of discontent must be addressed.
Sheridan added. “In order to keep their best employees, companies need to ensure that they are paying competitively with an appropriate salary and bonus structure. Companies will also do well to focus on initiatives that support work-life balance, such as remote and flexible working, as they become increasingly important to employees. Whilst counteroffers may appear to work in the short term, employers must address the underlying issues in order to retain top performers. If not, it is likely that the employee will leave, albeit in a more prolonged way and with a higher salary.”